Skip to main content

Advertisement

SpringerLink
Log in

The Construction of a Synthetic Index Comparing Multidimensional Well-Being in the European Union

  • Published:
Social Indicators Research Aims and scope Submit manuscript

Abstract

For many years, the quantification and measurement of level of well-being in a society has become an object of study by researchers, economists, international organizations and institutions. The purpose of these researches and applications is mainly the collection of data as accurate and complete as possible, dictating the paths of economic and social development policies, in order to help the economic problem of allocating scarce resources within a community, where not all individual needs can be fully met. The present work is intended as a part of that field. It will undertake the construction of a composite index of multidimensional well-being, through an aggregation of data, able to balance the trade-off between immediacy and completeness of information and to trespass the limits that characterize the commonly used income related measures. The method of factor analysis, which aims at detecting a statistically sufficient number of variables, is used to represent most of the explained variance of the phenomenon. Results are tested with different aggregative processes. This analysis is applied to the reality of the European Union, characterized by deep transformation and cultural, economic and social inequalities.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Fig. 1

Similar content being viewed by others

Notes

  1. The exclusion of Croatia, which joined the European Union on July 1, 2013, is due to the lack of observations in most of the variables considered.

  2. If we consider what was claimed by Chadeau and Fouquet (1981) the term domestic production activities means any unpaid activity, carried out by a family member for his family, and the consequent creation of a good or a service necessary for the performance of everyday life, for which there is a replacement market within the existing social norms.

  3. Since to draw the line between domestic production activities and leisure is puzzling, Roy (2011) proposes to refer to the guidelines specified by the Canadian Agency of Statistics, taking into account that from these activities can derive pleasure or not.

References

  • Abdi, H. (2003). Factor rotations in factor analyses. Encyclopedia for research methods for the social sciences (pp. 792–795). Thousand Oaks, CA: Sage.

    Google Scholar 

  • Arrow, K., Dasgupta, P., Goulder, L., Daly, G., Ehrlich, P., Heal, G., et al. (2004). Are we consuming too much? Journal of Economic Perspectives, 18, 147–172.

    Article  Google Scholar 

  • Berger-Schmitt, R., & Noll, H.-H. (2000). Conceptual framework and structure of a European system of social indicators. EuReporting Working Paper No. 9, Centre for Survey Research and Methodology (ZUMA), Social Indicators Department, Mannheim.

  • Bleys, B. (2012). Beyond GDP: Classifying alternative measures for progress. Social Indicators Research, 109(3), 355–376.

    Article  Google Scholar 

  • Brandolini, A. (2008). On applying synthetic indices of multidimensional well-being: Health and income inequalities in selected EU countries (Vol. 668). Banca d’Italia.

  • Carstairs, V. (2000). Socio-economic factors at area level and their relationship with health. In P. Elliott, J. Wakefield, N. Best, & D. Briggs (Eds.), Spatial epidemiology methods and applications (pp. 51–68). Oxford: Oxford University Press.

    Google Scholar 

  • Carstairs, V., & Morris, R. (1991). Deprivation and health in Scotland. Aberdeen: Aberdeen University Press.

    Google Scholar 

  • Cattell, R. B. (1966). The scree test for the number of factors. Multivariate Behavioural Research, 1(2), 245–276.

    Article  Google Scholar 

  • Chadeau, A., & Fouquet, A. (1981). Peut-on mesurer le travail domestique? Economie et Statistique, 136(1), 29–42.

    Article  Google Scholar 

  • CNEL-ISTAT. (2013). Benessere Equo e Sostenibile. Roma, Italia.

  • CNEL-ISTAT, Comitato sugli indicatori di progresso e benessere. (2012). La misurazione del Benessere Equo e Sostenibile. Roma, Italia.

  • Cummins, R. A. (1996). The domains of life satisfaction: An attempt to order chaos. Social Indicators Research, 38(3), 303–328.

    Article  Google Scholar 

  • Cummins, R. A., Andelman, R., Board, R., et al. (1998). Quality of life definition and terminology: A discussion document from the international society for quality of life studies. The International Society for Quality-of-Life Studies (ISQOLS).

  • Cuñado, J., & de Gracia, F. P. (2013). Environment and happiness: New evidence for Spain. Social Indicators Research, 112(3), 549–567.

    Article  Google Scholar 

  • Daly, H. E. (1977). Steady-state economics. San Francisco: W. H. Freeman.

    Google Scholar 

  • Daly, H. E., & Cobb, J. J. (1989). For the common good: Redirecting the economy toward community, the environment and a sustainable future. Boston: Beacon Press.

    Google Scholar 

  • Dasgupta, P. (2000). Valuation and evaluation: Measuring the quality of life and evaluating policy. In Background paper prepared for the World Bank’s annual World Development Report, World Bank.

  • Dasgupta, P. (2001). Human well-being and the natural environment. Oxford: Oxford University Press.

    Book  Google Scholar 

  • Dasgupta, P., & Mäler, K.-G. (2000). Net national product, wealth, and social well-being. Environment and Development Economics, 5(1–2), 69–93.

    Article  Google Scholar 

  • Dasgupta, P., Sen, A., & Marglin, S. (1972). Guidelines for project evaluation. New York: United Nations.

    Google Scholar 

  • Dasgupta, P., & Weale, M. (1992). On measuring the quality of life. World Development, 20(1), 119–131.

    Article  Google Scholar 

  • De Muro, P., Mazziotta, M., & Pareto, A. (2009). Composite indices for multidimensional development and poverty: An application to MDG indicators. In Wye city group meeting. Held in Rome, Italy. June. http://www.fao.org/es/ess/rural/wye_city_group

  • Decancq, K., & Lugo, M. A. (2013). Weights in multidimensional indices of wellbeing: An overview. Econometric Reviews, 32(1), 7–34.

    Article  Google Scholar 

  • Diener, E., & Suh, E. (1997). Measuring quality of life: Economic, social, and subjective indicators. Social Indicators Research, 40, 189–216.

    Article  Google Scholar 

  • Dillon, W. R., & Goldstein, M. (1984). Multivariate analysis: Methods and applications (Vol. 45). New York: Wiley.

    Google Scholar 

  • Distaso, A. (2007). Well-being and/or quality of life in EU countries through a multidimensional index of sustainability. Ecological Economics, 64(1), 163–180.

    Article  Google Scholar 

  • Doyal, L., & Gough, I. (1991). A theory of human need. Basingstoke and New York: Palgrave Macmillan.

    Book  Google Scholar 

  • Doyal, L., & Gough, I. (1993). Need satisfaction as a measure of human welfare. In W. Blass & J. Foster (Eds.), Mixed economies in Europe. London: Edward Elgar.

    Google Scholar 

  • Easterlin, R. (1974). Does Economic growth improve the human lot? Some empirical evidence. In P. A. David & M. Reder (Eds.), Nations and households in economic growth: Essays in Honor of Moses Abramowitz. NewYork: Academic Press.

    Google Scholar 

  • Erikson, R. (1993). Description of inequality: The Swedish approach to welfare research. In M. Nussbaum & A. K. Sen (Eds.), The quality of life. Oxford: Oxford University Press.

    Google Scholar 

  • Frank, R. H. (1985). Choosing the right pond: Human behaviour and the quest for status. New York: Oxford University Press.

    Google Scholar 

  • Frank, R. H. (2004). Positional externalities cause large and preventable welfare losses. American Economic Review, 95(2), 137–141.

    Article  Google Scholar 

  • Galbraith, J. K., & Crook, A. (1958). The affluent society (Vol. 534). Boston: Houghton Mifflin.

    Google Scholar 

  • Gasper, D. (2010). Understanding the diversity of conceptions of well-being and quality of life. The Journal of Socio-Economics, 39(3), 351–360.

    Article  Google Scholar 

  • Goossens, Y., Mäkipää, A., Schepelmann, P., de Sand, I., Kuhndt, M., & Herrndorf M. (2007). Alternative progress indicators to gross domestic product (GDP) as a means towards sustainable development. Study provided for the European Parliament’s Committee on the Environment, Public Health and Food Safety. PDESP/European Parliament.

  • Gordon, D., & Pantazis, C. (1997). Breadline Britain in the 1990s. England: Ashgate Publishing Limited.

    Google Scholar 

  • Grasso, M. (2002). Una misurazione del benessere nelle regioni italiane. Politica Economica, 18(2), 261.

    Google Scholar 

  • Grasso, M., & Canova, L. (2008). An assessment of the quality of life in the European Union based on the social indicators approach. Social Indicators Research, 87(1), 1–25.

    Article  Google Scholar 

  • Grasso, M., & Pareglio, S. (2007). Ranking well-being in the European Union. Rivista Internazionale di Scienze Sociali, 2, 242–263.

    Google Scholar 

  • Grisez, G., Boyle, J., & Finnis, J. (1987). Practical principles, moral truth and ultimate ends. American Journal of Jurisprudence, 32, 99.

    Article  Google Scholar 

  • Guilford, J. P., & Hoepfner, R. (1971). The analysis of intelligence. New York: McGraw-Hill.

    Google Scholar 

  • Härdle, W., & Simar, L. (2007). Applied multivariate statistical analysis (Vol. 22007). Berlin: Springer.

    Google Scholar 

  • Hartwick, J. M. (1990). Natural resources, national accounting and economic depreciation. Journal of Public Economics, 43, 291–304.

    Article  Google Scholar 

  • Hicks, J. R. (1946). Value and capital (Vol. 2). Oxford: Clarendon Press.

    Google Scholar 

  • Hirsch, F. (1976). Social limits to growth. Cambridge, MA: Harvard University Press.

    Book  Google Scholar 

  • Hogan, J. W., & Tchernis, R. (2004). Bayesian factor analysis for spatially correlated data, with application to summarizing area-level material deprivation from census data. Journal of the American Statistical Association, 99(466), 314–324.

    Article  Google Scholar 

  • Ivaldi, E., & Testi, A. (2011). Socio-economic conditions and health in Europe: A comparison among the 27 EU countries. In J. D. Rosen & A. P. Eliot (Eds.), Social inequalities (pp. 127–150). Hauppauge: Nova Science Publishers.

    Google Scholar 

  • Jarman, B. (1983). Identification of underprivileged areas. British Medical Journal, 1983(286), 1705–1709.

    Article  Google Scholar 

  • Johnson, R. A., & Wichern, D. W. (2002). Applied multivariate statistical analysis (Vol. 5, No. 8). Upper Saddle River, NJ: Prentice Hall.

  • Kahneman, D., Krueger, A., Schkade, D., Schwarz, N., & Stone, A. (2004). Toward national well-being accounts. American Economic Review, 94, 429–434.

  • Kaiser, H. F. (1958). The varimax criterion for analytic rotation in factor analysis. Psychometrika, 23(3), 187–200.

    Article  Google Scholar 

  • Khan, H. (1991). Measurement and determinants of socioeconomic development: A critical conspectus. Social Indicators Research, 24, 153–175.

    Article  Google Scholar 

  • Krzanowski, W. J., & Marriott, F. H. C. (1994). Multivariate analysis. London: Edward Arnold.

    Google Scholar 

  • Maggino, F. (2009a). Towards more participative methods in the construction of social indicators: Survey techniques aimed at determining importance weights. In Paper presented at the 62nd conference of the World Association for Public Opinion Research Public Opinion and Survey Research in a Changing World (pp. 1–24). Swiss Foundation for Research in Social Sciences, University of Lausanne, Lausanne, Swiss, September 11–13, 2009.

  • Maggino, F. (2009b). Methodologies to integrate subjective and objective information to build well-being indicators. In Paper presented at the international conference from GDP to well-being: Economics on the road to sustainability (pp. 1–27). Università Politecnica delle Marche, Ancona, Italy, December 3–5, 2009.

  • Maggino, F., & Ruviglioni, E. (2008). Methodologies to integrate subjective and objective information to build well-being indicators. In SIS, Atti della XLIV Riunione Scientifica (pp. 383–390). Padova: CLEUP.

  • Max-Neef, M. (1993). Human scale development: Conception, application, and further reflections (Vol. 1). London: Apex Press.

    Google Scholar 

  • Mayer, S. E., & Jencks, C. (1989). Poverty and the distribution of material hardship. Journal of Human Resources, 21, 88–113.

    Article  Google Scholar 

  • Mazziotta, C., Mazziotta, M., Pareto, A., & Vidoli, F. (2010a). La sintesi di indicatori territoriali di dotazione infrastrutturale: Metodi di costruzione e procedure di ponderazione a confronto. Rivista di Economia e Statistica del Territorio, 1, 1–33.

    Google Scholar 

  • Mazziotta, M., & Pareto, A. (2007) Un indicatore sintetico di dotazione infrastrutturale: Il metodo delle penalità per coefficiente di variazione. In Lo sviluppo regionale nell’Unione Europea—Obiettivi, strategie, politiche. Atti della XXVIII Conferenza Italiana di Scienze Regionali, AISRe, Bolzano.

  • Mazziotta, M., & Pareto, A. (2011). Un indice sintetico non compensativo per la misura della dotazione infrastrutturale: Un’applicazione in ambito sanitario. Rivista di Statistica Ufficiale, 13(1), 63–79.

    Google Scholar 

  • Mazziotta, M., & Pareto, A. (2012). A non-compensatory approach for the measurement of the quality of life. In F. Maggino & G. Nuvolati (Ed.), Quality of life in Italy. Social Indicator Research Series 48 (pp. 27–40). Netherlands: Springer.

  • Mazziotta, M., Pareto, A., & Talucci, V. (2010b). La costruzione di indicatori di disuguaglianza sociale: Il caso delle regioni italiane. In XXXI Conferenza italiana di scienze regionali. http://www.grupposervizioambiente.it/aisre_sito/doc/papers/Mazziotta_Pareto_Talucci_AISRE.pdf

  • McGillivray, M. (2007). Human well-being: Issues concept and measurement. In M. McGillivray (Ed.), Human well-being. Concept and measurement (pp. 1–22). Basingstoke and New York: Palgrave Macmillan.

    Google Scholar 

  • McKay, S., & Collard, S. (2003). Developing deprivation questions for the family resources survey. United Kingdom Department for Work and Pensions, Working Paper Number 13.

  • Michalos, A. (2008). Education, happiness and wellbeing. Social Indicators Research, 87(3), 347–366.

    Article  Google Scholar 

  • Michalos, A., Sharpe, A., & Muhajarine, N. (2010). An approach to a Canadian Index of Wellbeing. Working Paper prepared for the Atkinson Charitable Foundation, Toronto.

  • Michalos, A.C., Smale, B., Labonté, R., Muharjarine, N., Scott, K., Moore, K., et al. (2011). The Canadian Index of Wellbeing. Technical Report 1.0. Canadian Index of Wellbeing and University of Waterloo, Waterloo, Canada.

  • Mishan, E. J. (1967). The cost of economic growth. London: Staples Press.

    Google Scholar 

  • Morrison, D. F. (1976). Multivariate statistical method. New York: Mc Graw-Hill.

    Google Scholar 

  • Narayan, D., Chambers, R., Shah, M. K., & Petesch, P. (2000). Voices of the poor: Crying out for change. New York: Oxford University Press for the World Bank.

    Book  Google Scholar 

  • Nardo, M., Saisana, M., Saltelli, A., Tarantola, S., Hoffman, A., & Giovannini, E. (2005). Handbook on constructing composite indicators: Methodology and user guide. No. 2005/3. OECD publishing.

  • Noll, H. H. (2002). Towards a European system of social indicators: Theoretical framework and system architecture. Social Indicators Research, 58(1–3), 47–87.

    Google Scholar 

  • Nordhaus, W. D., & Tobin, J. (1972). Is growth obsolete? In Economic research: Retrospect and prospect Vol 5: Economic growth (pp. 1–80). NBER.

  • Nussbaum, M. (2000). Women and human development: The capabilities approach. Cambridge: Cambridge University Press.

  • Oswald, A. J. (1997). Happiness and economic performance. Economic Journal, 107, 1815–1831.

    Article  Google Scholar 

  • Porter, M., Stern, S., & Artavia Loria, R. (2013). Social progress index 2013. Washington, DC: Social Progress Imperative.

    Google Scholar 

  • Ramsay, M. (1992). Human needs and the market. Aldershot: Avebury.

    Google Scholar 

  • Reig-Martínez, E. (2013). Social and economic wellbeing in Europe and the Mediterranean Basin: Building an enlarged human development indicator. Social Indicators Research, 111(2), 527–547.

    Article  Google Scholar 

  • Roy, D. (2011). La contribution du travail domestique au bien-être matériel des ménages: une quantification à partir de l’enquête Emploi du Temps. Document de travail. INSEE, Direction de Statistique Démographique et Sociales.

  • Salzman, J. (2003). Methodological choices encountered in the construction of composite indices of economic and social well-being. Ottawa, CAN: Centre for the Study of Living Standards.

    Google Scholar 

  • Samuelson, P. A. (1961). The evaluation of ‘Social Income’: Capital formation and wealth. In F. A. Lutz & D. C. Hague (Eds.), The theory of capital. London: MacMillan.

    Google Scholar 

  • Schwartz, S. H. (1994). Are there universal aspects in the structure and contents of human values? Journal of Social Issues, 50(4), 19–45.

    Article  Google Scholar 

  • Scitovsky, T. (1976). The joyless economy. New York: Oxford University Press.

    Google Scholar 

  • Sen, A. (1976). Real national income. Review of Economic Studies, 43(1), 19–39.

    Article  Google Scholar 

  • Sen, A. (1982). Choice, welfare and measurement. Oxford: Basic Blackwell.

  • Sen, A. (1985). Commodities and capabilities. Amsterdam: North-Holland.

  • Sen, A. (1993). Capability and well-being. In A. Sen & M. Nussbaum (Eds.), The quality of life. Oxford: Clarendon Press.

  • Somarriba, N., & Pena, B. (2009). Synthetic indicators of quality of life in Europe. Social Indicators Research, 94(1), 115–133.

    Article  Google Scholar 

  • Stevens, J. (2002). Applied multivariate statistics for social sciences. Mahwah NJ: Lawrence Erlbaum Associates Inc.

    Google Scholar 

  • Stewart, K. (2005). Dimensions of well-being in EU regions: Do GDP and unemployment tell us all we need to know? Social Indicators Research, 73, 221–246.

    Article  Google Scholar 

  • Stiglitz, J., Sen, A. K. & Fitoussi, J. P. (2009). Report of the Commission on the measurement of economic performance and social progress. http://www.stiglitz-sen-fitoussi.fr/documents/rapport_anglais.pdf

  • Sumner, L. W. (1996). Welfare, happiness, and ethics. Oxford: Claredon Press.

    Google Scholar 

  • Tinbergen, J., & Hueting, R. (1992). GNP and market prices: Wrong signals for sustainable economic success that mask environmental destruction. In R. Goodland, H. Daly, & S. El Serafy (Eds.), Population, technology and lifestyle: The transition to sustainability. Washington DC: Island Press.

    Google Scholar 

  • Van den Bergh, J. C. (2009). The GDP paradox. Journal of Economic Psychology, 30(2), 117–135.

    Article  Google Scholar 

  • Veenhoven, R. (2002). Why social policy needs subjective indicators. Social Indicators Research, 58(1–3), 33–46.

    Google Scholar 

  • Weitzman, M. L., & Löfgren, K.-G. (1997). On the welfare significance of green accounting as taught by parable. Journal of Environmental Economics and Management, 32, 139–153.

    Article  Google Scholar 

  • Zolotas, X. (1981). Economic growth and declining social welfare. New York: University Press.

    Google Scholar 

Download references

Acknowledgments

We wish to thank Prof. Bruno Soro (Department of Law, University of Genova) and Prof. Marco Mazzoli (Department of Economics, University of Genova) for their helpful comments and suggestions. Usual caveat applies.

Author information

Authors and Affiliations

  1. Department of Economics, University of Genova, Via Vivaldi 5, 16126, Genoa, Italy

    Enrico Ivaldi, Guido Bonatti & Riccardo Soliani

Authors
  1. Enrico Ivaldi
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Guido Bonatti
    View author publications

    You can also search for this author in PubMed Google Scholar

  3. Riccardo Soliani
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Enrico Ivaldi.

Appendices

Appendix 1: Selected Variables for the EWI Construction and Sources

See Tables 6.

Table 6 EWI indicators and sources
Full size table

Appendix 2: Dimensions Ranking

See Tables 7, 8, 9, 10, 11, 12, 13, 14, 15, 16 and 17.

Table 7 Health ranking
Full size table
Table 8 Education and training ranking
Full size table
Table 9 Work and life balance ranking
Full size table
Table 10 Economic well-being ranking
Full size table
Table 11 Social relationships ranking
Full size table
Table 12 Politics and institutions ranking
Full size table
Table 13 Security ranking
Full size table
Table 14 Subjective well-being ranking
Full size table
Table 15 Environment ranking
Full size table
Table 16 Research and innovation ranking
Full size table
Table 17 Quality of services ranking
Full size table

Rights and permissions

Reprints and permissions

About this article

Check for updates. Verify currency and authenticity via CrossMark

Cite this article

Ivaldi, E., Bonatti, G. & Soliani, R. The Construction of a Synthetic Index Comparing Multidimensional Well-Being in the European Union. Soc Indic Res 125, 397–430 (2016). https://doi.org/10.1007/s11205-014-0855-8

Download citation

  • Accepted:

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s11205-014-0855-8

Keywords

Search

Navigation